7 May 24

Like it or not, ELDs are coming. The good news? Rates are going to go up. Here’s why.

You can’t drive as many miles in a day when you’re running with an ELD. This is especially true when you have strict appointment times, when you’re detained for any reason, and when you need extra time to find parking.

If you’ve been using paper logs all along, you know that there are times when it’s really hard to make everything work without a little "editing" of the logs.

To be successful as an owner-operator, you need to cover your expenses. That includes driver pay, even when you’re the driver. There are two ways to do that: run more miles, or charge a higher rate per mile. The paper logs can provide flexibility,  up to a point, to gain just enough time to run those extra miles, but ELDs are not flexible. After December 18, the only solution will be to get higher rates.


Photo by ISAAC Instruments

Luckily there will be a lot of freight available, and there will be less competition. Trucks will run fewer miles per day every time a driver cuts his day short to find parking before the clock runs out, or a truck gets held overnight because the driver ran out of hours while waiting at the dock. It will happen thousands of times a day, all over the country, costing an hour here and there.

Brokers are going to need you more than ever, and they’re going to have more of certain types of jobs that you may not have handled before: power-only and team loads.

Power-Only Loads

The large mega-fleets have been preparing for the ELD mandate for years, by building trailer inventory at their big shipper customers. These are the same shippers that give loads to the brokers. Big carriers save a lot of time and effort when the shipper pre-loads the trailers and the driver just bobtails in for a drop and hook. If a broker calls you with one of these power-only loads, and you’re able to leave your trailer at home, it could be an opportunity to learn about this side of the business. I’m going to write a separate blog post with some tips on power-only hauls. Last year was the first year I pulled more of other companies’ trailers than I did my own. I made good money, and I didn’t waste valuable time loading and unloading.

Team Drivers 

My prediction: Team loads are going to be much more popular on hauls of 500 miles or more, especially if the shipper wants next-day service. A single driver may not be able to make that happen with ELDs. One traffic snarl or a poorly timed break could derail the whole operation, no matter what the speed limit might be. Team drivers can deliver next day. If you want to pursue team loads as an owner-operator, you’ll need to hire a driver, and that’s a big commitment. The advantage is that your team could specialize in long hauls and expedited runs.  

Expensive Appointments

When everyone is on the clock, and there’s no wiggle room, truckers are going to start charging more for anything that makes it harder to manage their time. Loads with strict appointment times will cost more. Brokers will pay a premium to secure a truck that can meet the shipper’s obligation. If the shipper detains your truck, you’re going to charge more for that, too. Ditto when your truck is ordered but not used (TONU). Get all the details written into the rate agreement. This will be a learning experience.

How to Win With ELDs

1) Reward shippers and brokers for flexibility in loading and unloading. Otherwise, charge extra when appointment times are strict or detention is excessive.

2) Plan in advance for breaks, fuel stops, and parking. When you run out of hours, you’re out. No more flexibility.

3) Most important: Start now to build relationships with professional, knowledgeable brokers. They’re going to need access to reliable carriers, and if they like working with you, they’ll call you first. 

 

Chad Boblett is the owner and driver of Boblett Brothers Trucking of Lexington, KY. Chad also founded the Rate Per Mile Masters group on Facebook, a communications hub for 11,000 members, including owner-operators, truck drivers, and other transportation and logistics pros. 

Comments (7) -

Mark Montague
Mark Montague

There are some analysts who question whether rates will go up as a result of ELDs.  I've been in and around trucking for 36 years now and there is no doubt in mind - rates WILL go up.  The main reason it was hard to get detention before was lack of proof, reason #1 will no longer exist.  Two, hauls of 500 to 660 miles that squeaked through with a bit of creative logging, won't pass the ELD limits.  Three, to make it ALL work, drivers will need to work smarter, not harder; with less pushing the limits, there is less supply and less supply means higher rates.  It's been a slow, steady climb but van rates have been rising in the back half of 2016 and since March 2017.  I expect those trends to continue as long as volumes don't slip.

Reply

I think you are full of S*** just like the FMCSA.  Rates will not go up nearly fast enough to counter the additional burdens placed upon the small companies this is going to kill. That is why all the big companies, JB, Swift, KNIGHT ((especially) have brokerages, to dump messed up and cheap loads on the little guy.  Many more than them as well. The ones with drivers living in virtual poverty.  They want ELD's fine... they own the trucks and if the drivers don't like them then quit, which a lot do!  I own my truck and the last I heard, the US is not a communist country, or is it becoming one?  Personally, I'll shut down and file bankruptcy before I let 'Big Brother' in my truck!

Reply

I'm counting on unreasonable, anti-government guys like you to get out of the business. Will be a great driver of increased rates in the spot market.

Reply

Higher rates what joke. Big carriers have been planning for this for years they will put the small business out of business. It's not only trucking is about all industries. Now that the people elected Trump it will be the bigining of the end for small business. Higher rates very unlikely. Just more DAT PROPAGANDA.

Reply

10-4 right on, but it's not Trump, It's congress!,,, vote them all out next term and look for independents

Reply

Harinder singh
Harinder singh

Republicans congress pass this bill to kill owner operator and small fleet. I m sure they been paid big money by Large trucking company. I don't care about rate. It is about freedom and democracy. Truck will be shut down every where because of the driving hours. Congress said they pass the law because 6 people die under the paperlog everyday. But one thing they does not talk that how many people die each day using Tynanol or Advil every day? The whole thing government doing to show people look how many job we created. Killing hour of commercial driving killing pay check making less money on the road. It will show unemployment rate low. This is all sucks. We will be next China in 20 years from now more and more rule, regulations for every citizen. God bless to all my Owner operator and small fleet.

Reply

I have never used ELD so please forgive my limited understanding. Its mandatory so I'll purchase one sometime this year, but, if time becomes a problem; its my truck, my authority - why not just unplug the thing? "Sorry officer, it just stopped working, here's my paper log" .. I don't see the issue here.  

Reply

Add comment

biuquote
  • Comment
  • Preview
Loading